SENS-AI
VOD Results Bullish

VODACOM GROUP LIMITED - Vodacom Group interim results and cash dividend distribution for the six months ended 30 September 2026

Vodacom Group Limited
Full analysis

What this filing means

Vodacom's interim print confirms the strong HEPS growth it guided the market to expect. HEPS rose 25.7% to 587cps, pro-forma EBITDA growth of 18.0% was ahead of management's guidance range, and pro-forma service revenue growth of 13.3% trended above the medium-term target. The reported 40.0% EBITDA jump and 25.6% revenue rise are flattered by Safaricom's consolidation from 30 June 2026, but the pro-forma comparison adjusts for the part-period Safaricom consolidation by assuming Safaricom was owned from 1 April 2025, while also applying constant-currency adjustments. The interim dividend of 355cps, up 7.6%, confirms the revised payout policy. The one serious caveat is the Kenyan High Court ruling that declared the Safaricom acquisition null and void, now under expedited appeal.

Vodacom delivered the strong earnings growth it had told the market to expect, and the dividend is higher. The pro-forma comparison adjusts for Safaricom having been consolidated only from 30 June 2026 rather than stripping Safaricom out, so the underlying growth is real. The worry is that a Kenyan court has said the Safaricom deal is invalid, and Vodacom is appealing — if the appeal fails, the numbers could change.

Bull case

  • Pro-forma EBITDA growth of 18.0% was ahead of the guidance range, reflecting operational leverage and broad-based portfolio strength.
  • Pro-forma service revenue grew 13.3%, trending above the medium-term target on strong commercial momentum across the portfolio.
  • Operating free cash flow increased 68.2% to R16 855 million.
  • Headline earnings per share rose 25.7%, while last-twelve-month ROCE remained stable at 26.5%.
  • Financial services revenue increased 99.0% to R15.9 billion and 19.2% on a pro-forma basis including Safaricom.

Bear case

  • The Kenyan High Court declared the Safaricom acquisition null and void, leaving Vodacom’s 55% holding exposed to the outcome of an expedited appeal despite the status quo being maintained.
  • Net debt to EBITDA increased from 0.9 times to 1.6 times, reflecting materially higher balance-sheet leverage.
  • Net profit from associates and joint ventures declined 22.7% to R1 409 million from R1 822 million.
  • Capital expenditure increased 41.0% to R13 279 million, raising the scale of investment required during the half.

AI-generated summary by SENS-AI, based on the original JSE SENS filing.

SENS-AI conclusion

Confirmation of the prior qualitative HEPS guidance: the 25.7% HEPS growth delivered the strong-growth outcome the trading statement promised, while the filing separately states that pro-forma EBITDA growth of 18.0% was ahead of management's guidance range. The Safaricom consolidation flatters the reported figures, but the pro-forma metrics show the underlying business accelerating, not just the deal arithmetic. The conviction signal is tempered by the Kenyan High Court ruling against the acquisition and the step-up in net debt to EBITDA from 0.9 to 1.6 times. So what: the operating momentum is genuine and ahead of plan, but the market still needs the appeal outcome to confirm the Safaricom consolidation is durable.

The Kenyan Court of Appeal outcome on the Safaricom acquisition is the next disclosure that will settle whether the consolidated earnings base is durable.

Evidence from the filing

  • Pro-forma EBITDA growth of 18.0% was ahead of the guidance range, reflecting operational leverage and broad-based portfolio strength.

    “Pro-forma EBITDA growth of 18.0%^ was ahead of our guidance range and reflected operational leverage and broad-based portfolio strength.”

  • Pro-forma service revenue grew 13.3%, trending above the medium-term target on strong commercial momentum across the portfolio.

    “On a pro-forma basis, which includes Safaricom in the comparative period, service revenue growth of 13.3%^ trended above our medium-term target and reflects strong commercial momentum across our portfolio.”

  • Operating free cash flow increased 68.2% to R16 855 million.

    “ Operating free cash flow [3] 16 855 10 022 68.2”

  • Headline earnings per share rose 25.7%, while last-twelve-month ROCE remained stable at 26.5%.

    “Headline earnings per share (HEPS) rose by 25.7% and ROCE over the last twelve months remained stable at 26.5%.”

  • Financial services revenue increased 99.0% to R15.9 billion and 19.2% on a pro-forma basis including Safaricom.

    “• Financial services revenue increased 99.0% to R15.9 billion and up 19.2%^ on a pro-forma basis including Safaricom”

  • The Kenyan High Court declared the Safaricom acquisition null and void, leaving Vodacom’s 55% holding exposed to the outcome of an expedited appeal despite the status quo being maintained.

    “While the High Court in Kenya recently declared the acquisition null and void, an expedited appeal is underway and the Court of Appeal (Nairobi) has ordered that the status quo be maintained, meaning we remain the registered shareholder of the shares pending the outcome of the appeal.”

  • Net debt to EBITDA increased from 0.9 times to 1.6 times, reflecting materially higher balance-sheet leverage.

    “ Net debt to EBITDA (times) 1.6 0.9 0.7x”

  • Net profit from associates and joint ventures declined 22.7% to R1 409 million from R1 822 million.

    “ Net profit from associates and joint ventures 1 409 1 822 (22.7)”

  • Capital expenditure increased 41.0% to R13 279 million, raising the scale of investment required during the half.

    “ Capital expenditure [2] 13 279 9 416 41.0”
Category
Results
Event posture
Constructive
Published
Nov 10, 2026

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